h 116976

International Journal of Business and Management Invention

ISSN (Online): 2319 8028, ISSN (Print): 2319 801X www.ijbmi.org

Volume 1Issue 1 December. 2012 PP.69-76

www.ijbmi.org 69 | P a g e

The Influence of Organizational Culture, Organizational

Commitment to Job Satisfaction and Employee Performance

(Study at Municipal Waterworks of Jayapura, Papua

Indonesia)

1Jack Henry Syauta

2Eka Afnan Troena,

3Margono Setiawan,

4Solimun

1Economic Faculty of Cendrawasih University, Jayapura, Papua, Indonesia

2.3.4Economic Faculty & Business of Brawijaya University, Malang, Indonesia

ABSTRACT: The research aimed at analyzing and revealing the influence of organization cultural and organizational commitment to employee performance direct or indirectly to the job

performance. Data collection was done by questionnaire. The research samples were 127

employees. The research used descriptive analysis to determine characteristic and description of

respondent for each variable indicator. While to test the relation among variable by using

inferential analysis with Partial Least Square (PLS) method and Sob el Test. The results showed that

organizational culture does not influence directly to the employee performance. Organizational

culture able to influence performance if mediated by job satisfaction. While organizational

commitment influence significantly to employee performance directly or indirectly through work

satisfaction.

Keywordsorganization culture, organizational commitment, job satisfaction, employee performance.

I. INTRODUCTION Human resource is one of resources that determine the organization success. Because of

that, organizations are demanded to manage the human resources well for the organization survi val.

Nitisemito (1992) stated that a company that able to improve the work spirit and enthusiasm then

they will get many benefit.

Municipal waterworks is one of service companies that provides clean water for community.

The presence of the company through Act/5/1962 as local government owned corporation that give

services and bring benefit for public in drink water. The company activities are from collecting,

managing and purifying, and distributing the water to community. The faced obstacles by PDAM in

distributing the water such as, high operational cost, limited production capacity, limited

production infrastructure, high leakage. They cause water distribution do not run well. And also

employee problem. Strike that is caused by dissatisfaction to the ma nagement policies, such as

employee promotion in the implementation give less attention to employee achievement. It causes

conflict, then the low performance. The conflict usually is caused by nonconductive organization

culture (Asfar, 1994). Beside that, employee satisfaction, organizational commitment are the

causing factors of the low productivity of company Indonesia (Nitisemito, 1992).

High performer employee related with the high job satisfaction. Puspakumari (2008)

showed that there was significant and positive relation between employee job satisfaction to the

employee performance. And also Hussin (2011) showed that job satisfaction influence positively to

the employee achievement.

Job satisfaction is a needed condition by someone in doing their work, because if the work

able to bring satisfaction, then the employee will do the job well and produce good performance.

Robbins (2003), theoretically there are three reason for the importance of the job satisfaction in the

organization. First, unsatisfied employees do not care with the work and possibly resign. Second,

satisfied employees have better health and long life. Third, satisfaction to the job will be brought

into life outside the work.

The Influence Of Organizational Culture, Organizational Commitment To Job


Beside that, the organizational culture has important role in the relation with the employee

performance. Because the company culture as tool to reach goal by asking the values as needed

by company to always conductive and competitive. Wawan and Nugroho (2001) explained that a

healthy company but does not has good culture, then the company does not has long life. Someday

there will be demonstration, strike or the like that make the organization not healthy or bankrupt.

So it is clear that the company goals will not be reached without approach through organi zational

culture. Gibson et al (1997). Furthermore, Moeljono (2003) stated, to improve the organizational

performance, it needs professional human resources and strong culture.

It is supported by empirical investigation of Ojo (2009) , concluded that organizational

culture influence positively to employee performance. Ebtesbam et al (2011) showed that

organizational culture significantly and positively influence the performance. Ahmad (2012) stated

that organizational culture influence positively to the pe rformance. Other research by Raka (2003),

stated that no direct influence by organizational culture to organizational performance. The

influence of both variable will occur if mediated by employee behavior. And also Ghani (2006)

concluded that organizational culture did not influence significantly to the employee performance.

Other factors also influence the performance such organizational commitment. Luthans

(2006) stated that organizational commitment is 1) strong desire to be member of certain

organization 2) desire to try hardly suitable with the organization will 3) certain belief, and

accepting value and goals of organization.

It is a attitude that reflects the employee loyalty to organization and continuous process

where organization member expressing their attention to organization and its success and

continuity. Basically, the employee commitment are needed to support the work achievement,

because commitment is relative power from individual identification to organization.

Empirical investigation about organizational commitment with the employee performance,

done by Rashid et al (2003); Paik et al (2007); Khyzer (2001), their results showed that the

organizational commitment impact positively to the performance. While research of (Wright, T.A

1997 in Yousef, 2000), the results showed negative correlation between organizational commitment

and the work performance.

Based on the field phenomenon and the empirical investigation, then the research problem

investigated the organizational culture and organizational commitment partially to the employee

performance and testing whether work variable can be used as mediation for the organizational

culture to the employee performance and the influence of organizational commitment to the

employee performance.

II. LITERATURE REVIEW Organizational Culture

Gibson et al (1997) defined organizational culture as the system that penetrate values, belief

and norms in each organization. Organizational culture able encourage and discourage the

effectiveness depend on the value characteristic, belief, and norms. Schein (1992), organizational

culture is basic assumption pattern that is created, found, or developed by certain group when they

adapting themselves with the external problems and internal integration work well a nd considered

as worth, and taught to new members the correct way to realize, think, and feel the relation with

the problems. And Robbins (2006), organizational culture is collective meaning system that are

followed by the members that differentiate the o rganization to others.

Cultural indicators in the research used from Wallach (1983) grouped organizational

culture become three, that is: bureaucracy culture. Innovative culture and supportive culture. (1)

bureaucracy culture is culture hose condition needs arrangement, command and rules (2) innovative

culture bring freedom to participant in it to free in thinking, stating opinion, free their thought and

feeling and to work (3) supportive culture is in its communication interaction give emphasis to the

kinship values such as harmony, openness, friendship, cooperation, and trust.

Organizational Commitment

Marthis and Jackson (2000) give definition, organizational commitment is degree to

employee believe in and accept organizational goals and desire to remain with organization.

Luthans (2006) stated that organizational commitment is 1) strong desire to be member of certain

organization 2) desire to try hardly suitable with the organization will 3) certain belief, and

accepting value and goals of organization. And Sopiah (2008) concluded that organizational

commitment is a psychological bond of employee to organization that is marked with (1) strong



belief and acceptance for organizational goals and values (2) desire to reach organizational goals,

and (3) strong will to defend their position as organization members.

In this study, organizational commitment indicators used from Meyer and Allen (1997) that divided

into three components: affective commitment is psychologically involvement with organization

based on how good their feeling about organization. Continuance commitment is the members

involvement psychologically to organization because his cost as consequences exit from

organization because their moral duties to maintain the relation with organizati on.

Job Satisfaction

Robbin and Judge (2008), job satisfaction as positive feeling about someone job that is the

results of the characteristic evaluation results. Someone with high job satisfaction has positive

feeling about the job. Luthans (2006), job satisfaction is pleasure emotional feeling or positive

emotions come from the work valuation or experience. Beside that, Nasaradin (2001) stated that job

satisfaction may be a pleasurable or positive emotional state resulting from the appraisal of ones job or job experience.

In this study, the job satisfaction indicator used according to Luthans (2006) such as: work

itself, salary, promotion opportunities, supervisor, colleagues.

Performance

Prawirosentoso (2000), performance is work results that achie ved by someone or group in

organization, suitable with the authority and responsibility, in effort to reach the organizational

goals legally, not violate the law, and suitable with moral and ethics. Mangkunegara (2005),

employee performance is work outcome in quality and quantity that achieved by someone in

conducting his responsibility.

In this study, the performance indicators used according to Bernadin or Rusel (1993), that

is: quality, related with how far the process or activities implementation clo se to perfection or

close to the expected goals. Quantity related with the produced quantity, such as rupiah amount,

unit amount, cycle amount, finished activities. Timelines, the punctuality level suitable with the

expectation by considering the coordination of other output with the available time with other

works. Cost effectiveness, how far the organizational resources usage (human, financial,

technological, material resources) are maximized to reach high goals, or decreasing the

disadvantage from each resources unit. Need for supervisor, is how far someone do his job to

prevent un expected actions. Interpersonal impact, how far the employee keep their self esteem,

good name and cooperation among the peers and subordinates.

III. METHOD The used instrument to collect data in the research is questionnaire that contained the

questions. The measurement scales to measure the respondents response by using Likert scale of 5

points consist of; SS = very agree (point 5), S = agree (point 4), N= neutral (point 3), TS = not

agree (point 2), and SST = very disagree (point 1)

Partial Least Square Analysis by Falk and Miller in Gozali (2006) used for testing, (1)

linearity assumption test (2) Goodness of Fit model test (outer model) (3) structural model test

(inner model) and test for structural model hypothesis (inner model). And Sobel Test, to test

whether the variable is mediating variable or not (Solimun, 2001).

IV. RESULTS Linearity assumption used Curve Fit linearity, that is relation among variables stated as

linear if fulfill one of the possibilities below (1) significant linear model (sig linear model 0.05), and sig of other linear model >0.05. The test results presented as follows



Table 1. Linearity assumption test

Variable

relation

Linear model test Sig of linear

model

Conclusion

X1 Y1 Significant linear model 0.000 Linear




Y1 Y2 Significant linear model 0.000 Linear

From table above, that sig of linear model



Table 4. Composite reliability test

Variable Composite reliability

Organizational culture

Organizational commitment

Job satisfaction

Employee performance

0.826

0.825

0.807

0.790

The test results showed the reliability composite root showed the greater value than 0.7 so

can be concluded that all construct fulfill composite reliability.

Goodness of fit test of structural model at inner model

Goodness of fit test of structural model at inner model by using predictive -relevance (Q2)

value. The calculation showed the predictive-relevance value of 0.6812 or 68.12%, so the model can

be said has relevant predictive value. The predictive relevance value of 68.12% indicated that the

data variance can be explained by the model of 68.12%.

Hypotheses testing

The hypothesis testing done by t test (t test) at each influence path partially. It is shown in

table 5 below.

Table 5. Direct Influence Hypotheses Test

Independent

variable

Dependent

variable

Path

coefficient

p-value Statistic Explanation

Organizational

Culture

Employee

Performance

0.081 0.322 0.990 Not

significant

Organizational

Commitment

Employee

Performance

0.417 0.000 7.362 Significant

Organizational

culture

Job

satisfaction

0.352 0.000 4.358 Significant

Organizational

commitment

Job

satisfaction

0.367 0.000 5.641 Significant

Job

satisfaction

Employee

performance

0.451 0.000 7.056 Significant

Table 6. Mediation analysis results of job satisfaction to organizational

culture to the employee performance .

Sobel Test Results

Relation Coeficient Se Zcalculation Sig Explanation

BOJSEP 0.159 0.047 3.398 0.000 Significant

Explanation: BO=Organization Culture, JS = Job Satisfaction, EP= Employee Performance.

Table 7. Mediation analysis results of job satisfaction to organizational

commitment to the employee performance

Sobel Test Results

Relation Coeficient Se Zcalculation Sig Explanation

OCJSEP 0.166 0.038 4.386 0.000 Significant Explanation: OC=Organizational Commitment, JS=Job Satisfaction, EP=Employee Performance.

Based on table 5, table 6, table 7, it can be explained the research hypotheses test results as follows:

Organizational culture influence test (X1) to employee performance (Y2), obtained path

coefficient of 0.081, tcalculation value of 0.990 and p-value of 0.322. Because the tcalculation lower than ttable of 1.96 and alpha of 5% (0.05), p-value was higher than alpha of 0.05, indicated no significant

influence between organizational culture (X1) to employee performance (Y2). It shoed that no

enough empirical evidence to accept hypothesis (H1) that the stronger organizational culture able to

improve the employee performance.

- Organizational commitment influence test (X2) to the employee performance (Y2) obtained path coefficient of 0.417, t calculation value of 7.362 and p-value of 0.000. Because the tcalculation higher

than ttable of 1.96 and alpha of 5% (0.05), p-value was lower than alpha of 0.05, indicated there is



significant influence between organizational commitment (X2) to employee performance (Y2). It

shoed that there is enough empirical evidence to accept hypothesis (H2) that the stronger

organizational commitment able to improve the employee performance. It means the higher

organizational commitment (X2) the higher employee performance (Y2)

- Based on the testing of organizational culture direct influence to employee performance that was not significant and the influence of job satisfaction to employee performance that was

significant, then it can be identified there was indirect influence (mediation) between organizational

culture to the employee performance that is mediated by job satisfaction. To test further whether

mediating variable of job satisfaction at the organizational cultural influence relation to the

employee performance, then Sobel test was done. Table 6 showed the Sobel test of job satisfaction

mediation test to organizational cultural influence to employee performance, where the mediating

effect of job satisfaction to the organizational culture to the employee performance with Sobel test,

obtained indirect path coefficient of 0.159, Z calculation value of 3.398 and significane of 0.000.

Because Zcalculation =3.398 higher than Z table =1.96 and significance value of 0.000 lower than 0.05,

then it indicated that there was significant influence between organizational culture to employee

performance through job satisfaction. It sowed that there was enough empirical evidence to accept

hypothesis (H3) that the job satisfaction able to mediate the influence of organizational culture to

the employee performance. The positive path coefficient showed the higher organizational culture

value instilled into employee then the higher satisfaction, the higher satisfaction the higher

performance.

Based on the testing of organizational commitment direct influence to employee

performance that was significant and the influence of job satisfaction to employee performance that

was significant, then it can be identified there was indirect influence (mediation) between

organizational commitment to the employee performance that is mediated by job satisfaction. To

test further whether mediating variable of job satisfaction at the organizational cultural influence

relation to the employee performance, then Sobel test was done. Table 7 showed the Sobel test of

job satisfaction mediation test to organizational cultural influence to employee performance, where

the mediating effect of job satisfaction to the organizational commitment to the employee

performance with Sobel test, obtained indirect path coefficient of 0.166, Z calculation value of 4.386

and significane of 0.000. Because Zcalculation =4.386 higher than Z table =1.96 and significance value

of 0.000 lower than 0.05, then it indicated that there was significant influence between

organizational commitment to employee performance through job satisfaction. It sowed that there

was enough empirical evidence to accept hypothesis (H4) that the job satisfaction able to mediate

the influence of organizational commitment to the employee performance. The positive path

coefficient showed the higher organizational commitment value instilled into employee then the

higher satisfaction, the higher satisfaction the higher performance.

V. DISCUSSION The influence of organizational culture to employee performance

Organizational culture does not influence employee performance. The results support Raka

(2003), Ghani (2006) who stated that there were not direct influence of organizational culture to

performance. The research does not support Aluko (2003), Swanepoel (2009), Ebtesbam et al

(2011), Ahmad (2012) where their research stated that organizational culture influence positively to

performance. Beside that, the results contrary with theory that stated organization culture able to

improve the organizational effectiveness (Denilson, 1990)

Organizational commitment influence to employee performance

There were enough empirical evidence (H2) that the higher organizational commitment the higher employee performance. The positive path coefficient of 0.367, indicated the influence of organizational commitment to the employee performance in one direction. It means, the higher

organizational commitment, the higher employee performance. The results supported Rashid et al

(2003), Khan et al (2010), Paik et al (207), Khyzer and Ahmed (2011), the empirical results showed

the organizational commitment influence significantly and positively to per formance.

The influence of organizational culture to employee performance through job satisfaction

The statistical results showed organizational culture to employee performance through

mediating variable of job satisfaction has positive and significant influence. Where the positive path

(0.159) showed the stronger organizational culture the higher work satisfaction and then improve

the employee performance. The results were supported by Sobel test that showed the job



satisfaction able to mediate the organizational culture to employee performance. Work satisfaction

is mediating variable that is complete in nature.

The influence of organizational commitment to employee performance through job satisfaction

The statistical results showed organizational commitment to employee performance through

mediating variable of job satisfaction has positive and significant influence. Where the positive path

(0.166) showed the stronger organizational commitment the higher job satisfaction and then

improve the employee performance. The results were supported by Sobel test that showed the

employee satisfaction able to mediate the organizational commitment to employee performance. Job

satisfaction is mediating variable that is partial in nature.

VI. CONCLUSIONS Organizational culture does not influence significantly to employee performance. It means the higher organizational culture unable to improve the employee performance, because of that

organizational culture value including (bureaucracy, innovative and supportive) should be

socialized to employee in each employee work so the organizational culture can be instilled in each

employee so they able to work better for company.

Organizational commitment influence significantly to the employee performance. It means the higher organizational commitment the higher employee performance. High committed employee

will devote all thought, abilities and skills for company advance.

Job satisfaction able to mediate organizational culture to the employee performance. It means the stronger organization able to improve job satisfaction, so the employees will do their

tasks and responsibilities well.

Job satisfaction able to mediate organizational commitment to the employee performance. The higher organizational commitment the higher job satisfaction and the higher performance.

REFERENCE [1]. Ahmad, Shalik M. 2012. Impact of Organizational Culture on Performance Management Practice in Pakistan,

Business Intelligence Journal , 5 (1) : 50-55 [2]. Aluko, M.A, 2003. The Impact of Culture on Organizational Pe rformance in Selected Textile Forms in Nigeria,

Journal of African Studies 12 (2): 164-79 [3]. Asfar, Muhammad. 1994. Some Factors that Influence Labor Strikes. Surabaya, Lemlit UNAIR. [4]. Bernardin, H. John, and Joyce Russel, 1993. Human Resources Management; An E xperimental Approach, USA:

Mc.Grawhill. Inc. [5]. Denilson, D.R. 1990, Corporate Culture and Organization Effectiveness, John Welly & Sons, New York. [6]. Estebam Mujeeb UI., Tahir Masood and Shaki Ahmad Muhammad, 2011. Relationship Between Organizational

Culture and Performance Management Practices, A Case of University in Pakistan . Journal of Competitiveness 4 (18): 06-48.

[7]. Ghani, Ahmad, 2006. The Influence of Leadership Style, Organizational Culture and Work Motivation to Employee Performance of Processed Wood Industry in Makasar City, South Sulawesi. Dissertation. Postgraduate Program of Brawijaya University. Malang

[8]. Gibson, Imam H. 2005. Multivariate Analysis with SPSS Software. Diponegoro Pres, Semarang. [9]. Hussin, Anuar. 2011. The Relationship Between Jobs Satisfa ction and Job Performance Among Employee in

Tradewinds Group of Companies, Center for Graduate Studies Open University Malaysia.

Htpp:www.google.com

[10]. Khan, Rias M. Zainuddin, Jam Faoog A. Ramay I.M. 2010. The Impact of Organizational Commitment on Employee Job Performance, European Journal of Social Sciences 15 (3) : 292-298.

[11]. Khyzer, M. Bin Dos and Ahmed Zulfigar. 2011. Impact of Employee Commitment on Organizational Performance. Arabian Journal of Business and Management Review, 1 (3): 57 -98.

[12]. Luthans, Fred. 2006. Organizational Behavior, Indonesian Edition, Translated by Vivin Andika et al. Andi Publisher. Yogyakarta.

[13]. Mangkunegara, A.A.A.P, 2005. Human Resources Evaluation. Reflika Aditama. Bandung [14]. Marthis, R.I. and Jackson J.H. 2000. Human Resources management. New Jersey. Prentice Hall. [15]. Meyer and Allen, 1997. Commitment in the Work Place, Theory, Research and Application. Sage Publication.

Inc. California. [16]. Moeljono D, 2003. Corporate Culture and Corporation Advantage, PT Elex Media Computindo, Gramedia

Group, Jakarta.

[17]. Nasarudin, 2001. Job Satisfaction and Organization Commitment among Malaysian Workforce, Proceeding of 5 Asian Academic of Management Conference. Klatang Pahang pp 270 -276

[18]. Nitisemito, Alex S. 1992. Personel Management . Ghalia of Eight Edition. Jakarta. [19]. Ojo, O. 2009. Impact Assessment of Corporate Culture on Employee Job Performance, Journal of Business

Inteligence. 2 (2): 388-397.

[20]. Paik, Yongsun, Parboteeah, Praveen K and Shim Wonshul. (2007). The Relationship between Perceived Compensation, Organizational Commitment and Job Satisfaction: the Case of Mexican Worker in Korean Maquailadoras. Journal of Resources Management 18 (10): 1768-1781.



[21]. Prawirosentono, Suryadi. 2000. Employee Performance Policy, Yogyakarta, BPFE. [22]. Pushpakumari, D.M. 2008. The Influence of Leadership, Organizational Culture, and Individual Factor to Work

Behavior and Organizational Performance of National Banks in Bali. Dissertation. Airlangga University.

Surabaya.

[23]. Rashid, Md. Zabid, Sambasivan, M., Johari J. 2003. The Influence of Corporate Culture and Organizational Commitment on Performance. Journal of Management Development 22 (8): 708-728.

[24]. Robbins, Stephen P. 2003. Organization Behavior. Edition1. Index Team Translation. PT. Indeks, Gramedia Group.

[25]. Robbins, Stephen P. 2003. Organization Behavior. Tenth Edition. Translation of Benyamin Molan, Indonesian Edition. PT Mancanan Jaya Cemerlang, Indonesia.

[26]. Robbins, Stephen P and Judge Timothy A. 2008. Organizational Behavior. Twelve Edition of Book 1, Translation of Diana Angelica, Indonesian Edition, Salemba Empat, Jakarta.

[27]. Schein, Edgar H. 1992. Organizational Culture and Leadership. San Francisco, Jassey Bass Publisher. [28]. Sopiah. 2008. Organizational Behavior. CV. Andi Offset. Yogyakarta. [29]. Solimun (2011). Testing for Mediation Variable. What Necessary: International Conference of Basic Science.

FMIPA of Brawijaya University.

[30]. Wawan. Syarwhani and Nugroho, D. Priyohadi. 2001. 2001. Article. Corporate Culture Building to Adaptive and Competitive Organization. Businessman Journal. No. 4. Y ear XXX.

[31]. Wallach, Wllen J. 1983. Individuals and Organization: The Cultural Match. Training and Development Journal. [32]. Yousef, A.D. 2000. Organizational Commitment, a Mediator of the Relationship of Leadership Behavior with

Job Satisfaction and Performance in Non Westerns Countries, Journal of Managerial Psychology 15 (1): 6 -28.

Documents

h 116976